From Center Square, Kevin Bessler
(The Center Square) – A new survey shows a record high rent delinquency rate in August among small business owners, especially in Illinois.
Alignable, a small business referral network, asked 7,331 small businesses around the country and 40% indicated that they couldn’t pay their rent in August on time or in full, the highest rate in 18 months.
Head of research Chuck Casto says Illinois’ number is even higher at 53%.
“Looks like Illinois is second only to Colorado in terms of rent delinquency among small businesses, and sadly it went up 13%,” Casto said.
Many taking the survey blamed their rent issues on a combination of negative trends in the economy, including rent spikes, high gas prices and the increasing cost of supplies and labor.
Forty-five percent of poll takers said their rent is at least 50% higher today than it was prior to the pandemic, with a quarter saying it is at least twice as high. About 12% said their rent has tripled.
Rent issues are even worse for minority-owned businesses, as 53% of their owners said they couldn’t afford August rent, up 4% from July.
Casto said that in many cases, if a business can’t pay its rent, it may have to fold up shop.
“This has been happening for about two years now, maybe more than two years, so a lot of the landlords are less lenient,” he said.
Most industries saw an increase in rent delinquency rates, with agriculture (50%), nonprofits (46%) and restaurants (46%) leading the way.